i THE INFLUENCE OF CORPORATE CULTURE OF VIETNAMESE COMPANIES: A STUDY OF CORPORATION FPT BY NGUYEN KHANH LY LY Graduation Project Submitted to the Department of Business Studies, HELP University College, in Partial Fulfillment of the Requirements for the Degree of Bachelor of Business (Accounting) Hons APRIL 2011 ii Declaration of Originality and Word Count –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– DECLARATION I hereby declare that the graduation project is based on my original work except for quotations and citations which have been duly acknowledged. I also declare that it has not been previously or concurrently submitted for any other course/degree at HELP University College or other institutions. The word count is 16,195 words. Nguyen Khanh Ly Ly iii ACKNOWLEDGEMENTS First and foremost, I would like to convey my special thanks to Ms. Dao Thi Thu Giang, my supervisor, for her guidance, suggestions and encouragement during the writing of my thesis. Without her help, this thesis would not have been able to be completed. Secondly, I would like to express my gratitude to all lecturers at International School Vietnam University for their teaching dedication and support. All knowledge and skills that I gained during my study have laid the foundation for me to accomplish my thesis as well as to pursuit further education in the future. Thirdly, I would like to sincerely thank all the employees and leaders in FPT corporation), especially the members of FPT Software, FPT University, for their comments and data provision for their suggestion to complete this thesis. Last but not least, my sincere thank goes to my parents and my friends for their constant assistance and encouragement during my preparation for this thesis. Hanoi, April, 2011 Nguyen Khanh Ly Ly iv ABSTRACT THE INFLUENCE OF CORPORATE CULTURE OF VIETNAMESE COMPANIES: A STUDY OF CORPORATION FPT By NGUYEN KHANH LY LY April 2011 Supervisor: Dr. Dao Thi Thu Giang Corporate culture has many definitions as it is heavily influenced by the industry in which it operates, geographical location, history, employee personalities, etc. Some formal definitions have arisen, but essentially a corporate culture has several key elements: it offers a clear corporate vision; it is supported by corporate values consistent with the aims of the company and aligned with the personal values of organization members; a high value is placed on employees at all levels and there is extensive employee interaction across many levels; and the culture is adaptable, adjusting to external conditions, and consistent, treating all employees equally and fairly. That is the motivation for the researcher to conduct the survey about the influence of corporate culture of Vietnamese companies. The objective of this study is to access the understanding of Vietnamese companies on the topics of corporate culture, and FPT is typical example. By conducting the research, the research is able to show that the understanding of corporate culture concepts and its importance in companies. The readers have little basic knowledge of corporate culture. Besides that, from analyzing, evaluating and finding the author found out the strong as well as the week points to draw lessons for Vietnam companies. v TABLE OF CONTENTS Page Declaration ii Acknowledgements iii Abstract iv Table of contents v List of figures and tables ix List of abbreviations xv CHAPTER 1 INTRODUCTION 1 1.1 Study background 1 1.2 The objectives of the study 2 1.3 The research question 2 1.4 Design of the study 2 CHAPTER 2 LITERATURE REVIEW 4 2.1 Definition of corporate culture and its elements 4 2.1.1 Definition of Culture 4 2.1.2 Definition of corporate culture 4 2.1.3 Elements affecting corporate culture 6 2.1.3.1 National culture 6 2.1.3.2 Role of leadership 6 2.1.3.3 Affections of business environment 7 2.2 The model of Edgar H. Schein 8 2.2.1 Artifact 10 2.2.1.1 Mission Statement 10 2.2.1.2 Architecture 11 2.2.1.3 Narrative 11 2.2.1.4 Language 12 2.2.1.5 Ceremonies 12 2.2.1.6 Norms of behavior 13 2.2.1.7 Symbol 13 vi 2.2.2 Espoused value 14 2.2.2.1 Vision 14 2.2.2.2 Mission 15 2.2.2.3 Core Value 16 2.2.3 Basic Underlying Assumptions 16 2.2.3.1 People’s relationship with natural environment 17 2.2.3.2 The temporal focus of human life 17 2.2.3.3 The innate character of human nature 18 2.2.3.4 The modality of human activity 18 2.2.3.5 The modality of a person’s relationships to others 19 2.3 The model of Geert Hofstede 19 2.3.1 Process – oriented versus Result oriented 19 2.3.2 Job – oriented versus Employee – oriented 20 2.3.3 Professional versus Parochial 21 2.3.4 Opened versus Closed 21 2.3.5 Tight versus Loose 22 2.3.6 Pragmatic versus Normative 23 CHAPTER 3 METHODOLOGY 24 3.1 Research methodology 24 3.2 Research tools: Primary data: 25 3.2.1 Observation. 25 3.2.2 Interview 25 3.2.3 Sampling 26 3.3 Limitations of thesis 27 CHAPTER 4 ANALYSIS 28 4.1 The history of forming corporate culture in FPT 28 4.1.1 The process of building corporate culture in FPT 29 4.1.2 Key Ideology 29 4.1.3 STCo culture 30 vii 4.1.4 Gen FPT 31 4.1.5 FPT Spirit 32 4.2 Analyzing FPT corporate culture 32 4.2.1 Performance of FPT corporate culture according to the model of Edgar H. Schein 32 4.2.1.1 Artifact 32 a. Mission Statement 32 b. Architecture 33 c. Narrative 35 d. Language 36 e. Ceremonies 37 f. Norms of behavior 39 g. Symbol 39 4.2.1.2 Espoused value 42 a. Vision 42 b. Mission 43 c. Core Value 44 4.2.1.3 Basic Underlying Assumptions 45 a. People’s relationship with natural environment 45 b. The temporal focus of human life 46 c. The innate character of human nature 46 e. The modality of a person’s relationships to others 47 4.2.2 Performance of FPT Corporation culture according to the model of Geert Hofsteed 47 4.2.2.1 Process – oriented versus Result oriented 47 4.2.2.2 Job – oriented versus Employee – oriented 48 4.2.2.3 Professional versus Parochial 49 4.2.2.4 Opened versus Closed 49 4.2.2.5 Tight versus Loose 50 4.2.2.6 Pragmatic versus Normative 50 4.3 The valuation of FPT corporate culture and the experienced lessons from building FPT corporate culture for Vietnam enterprises 51 4.3.1 Evaluating FPT corporate culture 51 4.3.1.1 Risks coming from inside 51 viii 4.3.1.2 Risks coming from outside 52 4.3.1.3 Achievements 53 4.3.2 Awareness of corporate culture in Vietnam enterprises (Actual situations of corporate culture in Vietnam) 53 4.3.3 The necessary of building corporate culture in Vietnam and the roles of CC in business 57 4.3.3.1 The necessary of building corporate culture in Vietnam 57 4.3.3.2 The roles of corporate culture in business 58 4.3.4 The useful lessons for leaders in Vietnam enterprises 59 4.3.4.1 Improvement on awareness of corporate culture 59 4.3.4.2 Building corporate culture for long term target 59 4.3.4.3 Preserving and promoting corporate culture 60 CHAPTER 5 CONCLUSION 62 5.1 Conclusion 62 5.2 Recommendation 63 REFERENCES 64 APPENDIX 66 APPENDIX 1 OPEN-ENDED QUESTIONS OF INTERVIEW 66 APPENDIX 2 OPEN-ENDED QUESTIONS OF INTERVIEW 67 ix LIST OF FIGURES AND TABLES Firgure 2.1 Elements of corporate culture 9 Figure 4.1 Mission statement of FPT 33 Figure 4.2 FPT Pham Hung building 34 Figure 4.3 – 4.4. Settings in one FPT working room 35 Firgure 4.5- 4.6. Ceremonies in FPT 38 Firgure 4.7 Men are given flowers in FPT 38 Firgure 4.8 – 4.9 Colors of FPT from outside to inside 41 Figure 4.10 – 4.11. Dressing code in FPT 41 Table 1: Evaluation scale of fpt corporation culture by hofstede model 51 Table 2: Awareness of the concept of enterprise culture 54 Table 3: Perceptions of the role of business culture 55 x LIST OF ABBREVIATIONS CC Corporate Culture CMMI Capability Maturity Model Integration Dr Doctor FPT Food Processing Technology ISO International Organization for Standardization PhD Doctor of Philosophy VCCI Vietnam Chamber of Commerce and Industry WTO World Trade Organization [...]... artifact At the surface, they are visible artifacts and observable behaviors – mission statement, architecture, narratives, language, ceremonies, and norms of behavior and symbols that are shared All of them are tangible and audible results of activity that are grounded in values and assumptions The second level which the author can hardly observe is espoused values Espoused values are the rules, the. .. to the world, organizations belong to society, family members belonging to their ethnic, culture and business of each is also part of national culture In the growing process of corporate, national culture always has impacted (direct or indirect) on many different aspects of the culture of the corporate That explains why there is a difference between West and East corporate cultures, the corporate culture. .. people have a thorough understanding of what CC is and what corporate culture covers; people, therefore, have not found the effective way to manage a company and comprehend the exact way in which a company operates In Vietnam, after “Doi moi”, a few businesses have built themselves a strong culture The aim of this study is to assess the influence of CC in Vietnamese companies And with the purpose of study. .. 2.2.1.3 Narrative Narratives are based on true events that are shared among organizational employees and told to new employees to inform them about a corporate or an organization Passing the long term of time, stories still keep alive the primary values of the corporate Storytelling is a powerful tool in organizational learning as well in that they communicate implicitly organizational values It also plays... smaller categories such as: national culture, business culture, organizational culture, corporate culture and et cetera Since 1980s, studying about corporate culture has been carried out from America and been built and developed strongly by Japanese This trend emerged as the owners of corporations realized that they needed to change the approach to their corporations Before that, the only way they could... companies to build their own separate culture, contributing to improve the image of Vietnam enterprises in the eyes of international friends, the author would like to analyze the model of CC of FPT Company in Vietnam as an example for other companies to follow 1 1.2 The objectives of the study - The main objectives of this study is to have a throughout understanding of corporate culture The first aim... symbols may be suitable with the brand of that organization On the other hand, there are also symbols of power in the organization which employees have to accept and respect Among symbols, a logo is an important asset of firms, because firms spend enormous amounts of time and money promoting them to achieve the company’s 13 corporate image goals and attract consumers (Henderson and Cote, 1998) A corporate. .. Ceremonies The activity models make one feature of corporate life According to Daft (2009, page 28) the ceremony is a dynamic and easy-to-understand one to the members of the company” There are three main types of ceremonies Reinforcing ceremonies represent an important category For example, the public award enforces the status of the person in the organization, and, at the same time, the values for which the. .. particularly popular in organizational memory 11 2.2.1.4 Language CC is first created through the use of language in the creation of a shared vision which is articulated in a firm mission statement The used vocabulary steers the organization toward what will become its shared culture This culture is then reinforced through all manners of language, evidenced in corporate communications such as organizational... we also look at Microsoft and the oldest insurance corporation of Japan: Daiichi Microsoft is a class representing young and dynamic company, specializing in the information technology has lax control systems Conversely, with a particular company in the financial management industry, established in 1902 should bear a lot of cultural influence in Japan, Daiichi apply strict management style; seem hard . Hanoi, April, 2011 Nguyen Khanh Ly Ly iv ABSTRACT THE INFLUENCE OF CORPORATE CULTURE OF VIETNAMESE COMPANIES: A STUDY OF CORPORATION FPT. many different aspects of the culture of the corporate. That explains why there is a difference between West and East corporate cultures, the corporate